When banks and credit card companies began to make the shift from magnet strip cards to EMV chips, they promised that it would reduce instances of credit card theft. In some ways, this appears poised to be a success. The magnet strip credit cards that most Americans have used for years were notoriously insecure, making it relatively easy for thieves to steal the information contained on the strips and use it to make purchases again and again. EMV chips counter that vulnerability by generating a one-time code for each transaction. Financial security experts believe this will significantly cut down on many different forms of credit card theft.
But as with any major shift to a new technology, there will be trade-offs. When you close your door on crime, criminals may come crashing through your window.
One troubling statistic from Javelin Strategy & Research shows that new account ID theft has increased by 113 percent, and now accounts for as much as one-fifth of all credit fraud. New account ID theft occurs when thieves use victims’ personal information to open up new lines of credit in their name. Once this occurs, even EMV technology isn’t enough to put a stop to the subsequent thefts.
“Fraud is evolving at a frantic pace, although the amount of fraud has been relatively flat over the past four years,” said Al Pascual, Senior Vice President at Javelin, in a statement. “This just shows that when the industry cracks down on one type of fraud, criminals quickly shift their attack vector and area of operation.”
Thieves have many paths to new account theft
How do thieves get the information they need to commit new account theft? There are a number of different approaches. Unfortunately for victims, they are all fairly simple.
Creating a new line of credit under someone else’s name can be as simple as stealing a Social Security Number, as well as an address and date of birth. Many of us do not keep our most important personal information as secure as we think we do. We have a tendency to use weak computer passwords that can be easily guessed, or bypassed through brute-force methods. We make the mistake of accessing sensitive web sites through Internet connections that have not been properly secured. We sometimes take a cavalier attitude to important paper documents, throwing them in the trash without shredding them.
It’s important to be vigilant about the simple habits that make us more likely to become victims of identity theft. But even that won’t be enough to protect every potential victim.
Identity theft can strike at any time
Every year, thousands of people become victims of identity theft. In fact, both government agencies and private sector sources estimate that the problem is steadily growing every year, even with the additional safety measures banks and credit card companies are taking. Sometimes these crimes can be traced to specific mistakes they made securing their information. But sometimes, thieves strike anyway. Everyone has multiple vulnerabilities, and it isn’t always possible to protect them all.
That’s why it is important to not only take precautions to prevent identity theft, but also to prepare for recovery. An identity theft protection service, like Identity Guard, can monitor your credit file, Social Security Number and public records, and alert you to certain activity that could be indicative of fraud. If someone is trying to steal your identity or abuse your credit, you’ll be able to react promptly.